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Delek Logistics (DKL)
NYSE:DKL
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Delek Logistics
(NYSE:DKL)
68Neutral
Positive Factors
Strategic Updates
Strategic updates have been announced, enhancing the company's future prospects and providing a potential upside.
Yield and Growth
The company offers a top-quartile yield and growth outlook, making it an attractive investment proposition.
Negative Factors
Market Reaction
The market has not fully digested the impact of recent strategic transactions, which may lead to short-term volatility.
Delek Logistics (DKL) vs. S&P 500 (SPY)
Market Cap
$2.21B
Dividend Yield10.55%
Average Volume (3M)227.74K
Price to Earnings (P/E)13.9
Beta (1Y)0.48
Revenue Growth-8.79%
EPS Growth7.75%
CountryUS
EmployeesN/A
SectorEnergy
Sector Strength45
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.73
Shares Outstanding53,440,790
10 Day Avg. Volume229,035
30 Day Avg. Volume227,743
Financial Highlights & Ratios
PEG Ratio1.85
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio30.33
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$46.00Price Target Upside11.14% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Delek Logistics Business Overview & Revenue Model
Company DescriptionDelek Logistics Partners, LP owns and operates logistics and marketing assets for crude oil, and intermediate and refined products in the United States. It operates through three segments: Pipelines and Transportation, Wholesale Marketing and Terminalling, and Investment in Pipeline Joint Ventures. The Pipelines and Transportation segment includes pipelines, trucks, and ancillary assets that provide crude oil gathering, crude oil intermediate and refined products transportation, and storage services primarily in support of the Tyler, El Dorado, and Big Spring refineries, as well as offers crude oil and other products transportation services to third parties. This segment operates approximately 400 miles of crude oil transportation pipelines; 450 miles of refined product pipelines; and approximately 900 miles of crude oil gathering, and intermediate and refined products storage tanks with an aggregate of approximately 10.2 million barrels of active shell capacity. The Wholesale Marketing and Terminalling segment provides wholesale marketing, transporting, storage, and terminalling services related to refined products to independent third parties. The Investments in Pipeline Joint Ventures Segment owns a portion of three joint ventures that have constructed separate crude oil pipeline systems and related ancillary assets, which serves third parties and subsidiaries. Delek Logistics GP, LLC serves as the general partner of the company. Delek Logistics Partners, LP was incorporated in 2012 and is headquartered in Brentwood, Tennessee. Delek Logistics Partners, LP operates as a subsidiary of Delek US Holdings, Inc.
How the Company Makes MoneyDelek Logistics makes money through a variety of revenue streams centered around its midstream energy operations. The company's primary sources of income include fees generated from transporting crude oil and refined products through its network of pipelines, as well as from the storage services provided by its tank farms and terminals. Additionally, DKL earns revenue by marketing petroleum products, where it leverages its infrastructure to purchase and sell crude oil and refined products. Another key component of its revenue model is long-term contracts and fee-based arrangements with Delek US Holdings, Inc., its parent company, and other third-party customers, which provide stable and predictable cash flows. Strategic partnerships and acquisitions also play a significant role in expanding its operational capabilities and market reach, further contributing to its earnings.
Delek Logistics Financial Statement Overview
Summary
Delek Logistics demonstrates strong operational efficiency and cash flow generation. However, it faces challenges with revenue volatility and high leverage, needing to address debt levels and stabilize revenue growth to improve financial health.Income Statement
The income statement shows a mixed performance. The company has maintained a steady gross profit margin, but the net profit margin has seen fluctuations. Revenue growth has been inconsistent, with a notable decline in the latest period. Despite this, EBITDA margins suggest strong operational efficiency.70
Positive
Balance Sheet
The balance sheet reveals high leverage with a significant debt-to-equity ratio, indicating potential financial risk. However, the company has managed to maintain a positive equity ratio recently, which suggests some stabilization in its financial structure.50
Neutral
Cash Flow
Cash flow analysis indicates robust operating cash flow relative to net income, highlighting good cash conversion. However, free cash flow growth has been inconsistent, and heavy capital expenditures could impact future liquidity.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 940.64M | 1.02B | 1.04B | 700.90M | 563.42M | Gross Profit |
| 243.75M | 284.96M | 249.40M | 217.15M | 206.74M | EBIT |
| 202.83M | 238.95M | 209.68M | 190.50M | 179.79M | EBITDA |
| 394.70M | 370.99M | 301.95M | 256.14M | 236.09M | Net Income Common Stockholders |
| 142.69M | 126.24M | 159.05M | 164.82M | 159.26M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 5.38M | 3.75M | 7.97M | 4.29M | 4.24M | Total Assets |
| 2.04B | 1.64B | 1.68B | 935.07M | 956.42M | Total Debt |
| 11.34M | 1.72B | 1.68B | 919.85M | 1.02B | Net Debt |
| 5.96M | 1.72B | 1.67B | 915.56M | 1.01B | Total Liabilities |
| 2.01B | 1.80B | 1.79B | 1.04B | 1.06B | Stockholders Equity |
| 35.53M | -161.87M | -110.70M | -103.99M | -108.30M |
| Cash Flow | Free Cash Flow | |||
| 77.30M | 124.97M | 45.47M | 251.15M | 179.73M | Operating Cash Flow |
| 206.34M | 225.32M | 192.17M | 275.16M | 193.02M | Investing Cash Flow |
| -384.58M | -89.63M | -770.44M | -16.36M | -123.14M | Financing Cash Flow |
| 179.87M | -139.91M | 581.95M | -258.75M | -71.18M |
Delek Logistics Technical Analysis
Positive
41.39
Price Trends
39.17
Positive
39.85
Positive
38.57
Positive
Market Momentum
0.55
Negative
65.10
Neutral
92.75
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DKL, the sentiment is Positive. The current price of 41.39 is above the 20-day moving average (MA) of 38.33, above the 50-day MA of 39.17, and above the 200-day MA of 38.57, indicating a bullish trend. The MACD of 0.55 indicates Negative momentum. The RSI at 65.10 is Neutral, neither overbought nor oversold. The STOCH value of 92.75 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DKL.
Delek Logistics Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $9.09B | 22.05 | 19.71% | 4.75% | 5.03% | 7.15% | |
68 Neutral | $2.21B | 13.85 | 542.39% | 10.55% | -8.79% | 7.75% | |
61 Neutral | $1.68B | 15.67 | 16.23% | 5.88% | 6.04% | 18.28% | |
57 Neutral | $7.18B | 3.26 | -3.67% | 5.68% | 0.47% | -50.25% | |
52 Neutral | $1.88B | ― | -14.83% | 4.20% | -17.81% | -590.48% | |
52 Neutral | $541.01M | 5.86 | -28.13% | ― | -4.69% | -418.50% | |
44 Neutral | $436.96M | ― | -19.22% | ― | -19.76% | -323.41% |
* Energy Sector Average
Performance Comparison
DKL
Delek Logistics
41.39
6.07
17.19%
GEL
Genesis Energy
15.18
2.58
20.48%
GLP
Global Partners
49.36
6.86
16.14%
NGL
NGL Energy Partners
3.31
-2.35
-41.52%
SMC
Summit Midstream
27.91
-6.02
-17.74%
AM
Antero Midstream
18.88
4.70
33.15%
Delek Logistics Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 9.58%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
The earnings call highlighted Delek Logistics Partners' strong financial performance, strategic progress in increasing economic separation, and successful expansion efforts, particularly in the Delaware Basin. However, there were some challenges in specific segments such as wholesale marketing and terminalling, as well as storage and transportation, which experienced declines in EBITDA. Overall, the positive developments and growth opportunities presented outweighed the negative aspects.Q1-2025 Updates
Positive Updates
Record Quarterly Adjusted EBITDA
Delek Logistics Partners reported approximately $117 million in quarterly adjusted EBITDA, putting the company on track to deliver on its full year EBITDA guidance of $480 million to $520 million.
Increased Economic Separation
Intercompany transactions increased Delek Logistics' economic separation, bringing third-party contribution to cash flow from 70% to around 80% on a pro forma basis.
Libby Plant Expansion Progress
The commissioning phase of the new Libby plant expansion is underway, with expected capacity fulfillment in the second half of 2025.
49th Consecutive Quarterly Distribution Increase
The Board of Directors approved a 49th consecutive increase in the quarterly distribution to $1.11 per unit.
Strong Performance in Gathering and Processing Segment
The segment's adjusted EBITDA for the quarter was $81 million, up from $50 million in the first quarter of 2024, primarily due to acquisitions of H2O and Gravity Midstream.
Significant Available Liquidity
Post-acquisition of Gravity and progress on the Libby 2 construction, Delek Logistics currently has approximately $450 million of available liquidity.
Negative Updates
Decrease in Wholesale Marketing and Terminalling EBITDA
Adjusted EBITDA for this segment was $18 million, down from $25 million in the prior year, primarily due to seasonal weather impacts driving lower wholesale margins.
Storage and Transportation Segment Decline
The segment's adjusted EBITDA was $14 million compared with $18 million in the first quarter of 2024, mainly due to the amend and extend renegotiation completed last summer.
Company Guidance
During the Delek Logistics Partners first quarter 2025 earnings call, the company provided guidance indicating strong financial and operational performance. They reported a quarterly adjusted EBITDA of approximately $117 million and reaffirmed their full-year EBITDA guidance of $480 million to $520 million. The company highlighted significant progress in the Permian Basin, particularly with the commissioning of the Libby II gas plant, expected to add 100 to 120 million cubic feet per day of incremental capacity. The first quarter saw a distributable cash flow of $75 million with a DCF coverage ratio of 1.27x, projected to increase. Additionally, the company emphasized their strategic moves to enhance their competitive position through intercompany transactions, increasing third-party contributions to cash flow from 70% to 80% on a pro forma basis. They also announced a 49th consecutive quarterly distribution increase to $1.11 per unit, underscoring their commitment to growth and value creation.Delek Logistics Corporate Events
Executive/Board Changes
Delek Logistics Appoints New EVP and CFO
Positive
Apr 4, 2025
Delek US Holdings, Inc. and Delek Logistics Partners, LP have announced that Robert Wright will take on the roles of Executive Vice President and Chief Financial Officer of the Partnership starting April 1, 2025. Wright, who has been with the company since February 2024, will also be promoted to Executive Vice President of the Company by November 15, 2025. His compensation package includes a base salary increase and a long-term incentive award, highlighting the company’s commitment to retaining top talent.
Business Operations and Strategy
Delek Logistics Unveils New Investor Presentation Strategy
Positive
Apr 2, 2025
On April 1, 2025, Delek Logistics Partners’ senior management will begin using a new investor presentation for engaging with current and potential investors. This move is part of their strategy to enhance communication with stakeholders and potentially improve their market positioning. The presentation includes forward-looking statements about growth opportunities, financial guidance, and strategic investments, which could impact the company’s operations and stakeholder interests.
Executive/Board Changes
Delek Logistics Announces Leadership Change in 2025
Neutral
Feb 19, 2025
On February 19, 2025, Delek Logistics Partners, LP announced a leadership change as Reuven Spiegel, the Executive Vice President and Chief Financial Officer, will also assume the role of Executive Vice President of Delek Logistics effective February 12, 2025. This change follows the departure of Odely Sakazi, who left the company on February 12, 2025, and will receive a severance package subject to certain conditions.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.